Dollar climbs vs yen as concerns over N.Korea tensions ease

Paterniano Del Favero
Agosto 17, 2017

FIRE AND FURY: Keeping up his tough talk, Trump told reporters that North Korean leader Kim Jong Un's government should "get their act together" or face extraordinary trouble, and suggested his earlier threat to unleash "fire and fury" on North Korea was too mild. It is heading for a 2.5% drop for the week.

Pyongyang's plans to fire missiles near the U.S. The Swiss franc eased against dollar about 0.1 percent to 0.9645 per dollar, having surged about 1.1 percent on Wednesday.

A Chinese state-run newspaper said on Friday that China should make clear that it will stay neutral if North Korea launches an attack that threatens the United States, but that if the US attacks first and tries to overthrow North Korea's government, China will prevent it doing so.

European stocks opened sharply lower with Britain's FTSE 100 down 1.2 percent to 7,302.18.

Trump's second warning, however, has shaken markets that have been largely resilient this year, swatting away a slew of risks.

The S&P 500 posted 49 new 52-week highs and 10 new lows; the Nasdaq Composite recorded 98 new highs and 85 new lows.

Bond and gold prices, traditional havens for nervous investors, were little changed, and the VIX, a measure of how much volatility investors expect in stocks, slid 6.7% following a 44.4% jump the day before.

Analysts warned the softening dollar could test June's low of 108.82 yen and even the 2017 trough of 108.13 yen.

Several indexes closed lower overnight.

The Swiss franc and the yen are often sought in times of geopolitical tension or global financial stress, partly because both Switzerland and Japan have big current account surpluses.

Gold has risen to its highest level in nearly two months, while the Swiss franc has powered against the United States dollar and seen its biggest one-day gain against the euro in more than two and a half years.

Oil prices held steady after Monday's heavy selloff, weighed by a strong US dollar - which makes oil more expensive for overseas buyers - and signs of weaker demand in China, the world's second-largest consumer.

Geopolitical risks can boost demand for assets considered safe-haven investments, such as gold.

U.S. producer prices Thursday disappointed, as traders await consumer price inflation figures later Friday.

Palladium prices rose 0.1% to US$891.75 per ounce.

Stocks saw some strength during trading on Friday, regaining ground following the sell-off seen in the previous session.

Among technology companies, Apple shares rose $2.37, or 1.5 percent, to $159.85 and Microsoft picked up $1.09, or 1.5 percent, to $73.59.

In Europe, the pan-continental STOXX 600 index fell 0.9pc, with falls deepening after a auto rammed a group of soldiers in Paris, injuring six, in what officials said was a suspected terrorist attack. Copper dipped 1 cent to $2.90 a pound.

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